KARACHI: The textile millers have asked the government to completely withdraw the gas infrastructure development cess (GIDC) imposed on the textile industry.
All Pakistan Textile Mills Association (Aptma) Chairman Tariq Saud, in a statement, said that the continuous decline in exports, especially the textile exports is a matter of great concern since the exports of textile sector contribute over 55 percent in earning of the total export of the country and any decrease in textile exports would indicate decrease in the foreign exchange earning of the country.
He said that the textile industry is facing a grave situation because of the high cost of doing business and liquidity constraints, adding that imposition of GIDC has served to cripple the industry, which is already burdened and has become uncompetitive viz-a-viz to their regional competitors in the absence of liquidity flow.
Tariq Saud said in view of declining oil prices and natural gas prices in the international market, there is no justification for imposition of GIDC. He urged upon the government to remove GIDC from entire textile chain and enable it to regain its competitive edge and market share.
The Aptma chief further said that the import of synthetic yarns and fabrics of polyester, viscose and other blends is increasing by quantum leaps, adding that during the financial year 2012-13, the import of yarn under chapter 55 was 12,077 tonnes and is expected to reach 47,000 tonnes in the current financial year. “The import of fabric under chapter 55 was 65.1 square metres and is expected to increase to 125 million sqm. During the first eight months of the current financial year compared with the last full financial year (2014-15), the imports have surpassed the total imports in case of yarn and fabric imports,” he added.
He demanded the government to impose 15% regulatory duty on the import of yarn and fabric falling under chapter 55 of the Customs Tariff and the duty on import of viscose and acrylic fibers should be reduced to zero percent, so that the domestic yarn producers can compete with Indian, Indonesian, Chinese producers who have their own manufacturing capacities to produce these raw materials and their variants.
In order to revive the ailing textile industry, the Aptma chairman demanded immediate payments of all pending refunds by the Federal Board of Revenue (FBR), zero rating of all taxes on exports and providing rebate in the form of DLTL at 5% against export of yarns, fabrics, made-ups and garments, further reduction of long-term financing facility by at least 1 percent from 5 percent to 4 percent and reduction in export refinance facility by another 0.5% from 3.5% to 3% and to provide this facility to entire textile chain from spinning to garmenting.
